Proceeds from Old Air Force Base to Benefit Wheeler

Rick Alm On Apr 16, 2007
Source: The Kansas City Star

Apr. 14 -- City officials and representatives of CenterPoint Realty Services Corp. on Friday signed contracts that moved the $10.6 million sale of the former Richards-Gebaur Air Force Base closer to reality.

In late 2005 Chicago-based CenterPoint agreed to buy the nearly 1,400-acre former military airfield then spend an estimated $250 million to redevelop it as an intermodal rail and trucking port that already is used by Kansas City Southern.

Under an agreement with the Federal Aviation Administration, proceeds of the sale will go toward improvements at Wheeler Downtown Airport.

The city, meanwhile, has tentatively agreed to an estimated $5 million in public infrastructure work at Richards-Gebaur.

Friday's signing triggers a $400,000 payment from CenterPoint that will be used to begin environmental cleanup at the site. That work will remove hazards such as asbestos and lead from two long-closed Air Force landfills, a city-owned skeet-shooting range and other buildings. City officials are pressing federal authorities to assume much of the $17.4 million cost of that work.

The signing also started the clock on a 12-month due-diligence period for CenterPoint to close or cancel the deal. City officials are optimistic that final sale documents will be signed before the period ends.

The ambitious inland port project aims to recruit tenants from the manufacturing, warehousing and shipping industries that are attracted by Kansas City Southern's existing regional and international rail cargo operations.

Those cargo operations would become the centerpiece of the proposed International Freight Gateway at Richards-Gebaur.

When completed, the sprawling transit facility is expected to be a major Midwestern player in the movement of commerce among the United States, Canada and Mexico. CenterPoint executives have said Kansas City's geographic advantages should attract industrial users and shippers within a 500-mile radius.

Richards-Gebaur was deactivated as a full-fledged Air Force base in 1976 but kept some military reserve and air defense activity into the early 1990s.

It also became a general-user city airport but eventually lost more than $1 million a year. The city's decision to close it led to fights in the late 1990s with area business interests and others who tried to keep it open.

CenterPoint is an affiliate of CenterPoint Properties Trust, a publicly traded real estate investment trust that bills itself as the largest industrial developer in the Chicago market, with more than 80 million square feet of developed and developable space under its control.

The company owns the 2,200-acre CenterPoint Intermodal Center in Elwood, Ill., one of North America's largest truck-rail transfer facilities. In 2000, in partnership with more than 100 companies, CenterPoint converted a former Army arsenal in Joliet, Ill., to a 1,800-acre industrial park and intermodal facility.